Oregon Manufacturing Extension Partnership helps KIALOA increase capacity and sales

KIALOA Paddles, Inc., located in Bend, was experiencing growing pains and needed help. Business Oregon provided assistance through the Oregon Manufacturing Extension Partnership (OMEP). KIALOA was able to overcome their growing pains and are now seeing positive results from lean manufacturing changes. The company is retaining 10 jobs.

KIALOA manufactures a full line of carbon fiber, carbon fiber/wood hybrid and hand-crafted, wood paddles for outrigger and dragon boat racing, as well as stand up paddling. Business Oregon's Japan Relations Office representative met with KIALOA Paddles in 2009 to discuss various inquiries the company had received from Japan. They discussed pros and cons of each prospect, and later followed up with the Japanese contacts. Within months, KIALOA Paddles received an order for paddles, and they have recently shipped a second order to the same customer. In total, KIALOA Paddles has received more than $4,000 in exports to Japan as a direct result of Business Oregon export staff assistance.

From 2006 to 2008, KIALOA experienced tremendous sales growth, but the increased sales did not result in additional profits. KIALOA's owners found themselves working longer hours, but their efforts did not improve financial results or customer satisfaction. KIALOA had grown beyond what it could successfully support and the owners knew they needed help. In July of 2009, KIALOA engaged OMEP to assist in growing its business.

OMEP determined that adoption of its "Lean" principles in operations, production and supply chain management could greatly enhance KIALOA's business performance. KIALOA implemented "Lean flow" concepts to establish 'Build-to-Order' instead of 'Build-to-Stock' practices. OMEP also helped KIALOA use "value stream mapping" to identify and eliminate waste during production and to establish "Lean pull/flow" philosophies where possible. Working with key suppliers and using historical data and Lean principles, a mutually beneficial supply chain management system was developed to deliver components at the right time and at the correct levels.

The partnership resulted in a new capacity/production planning tool supporting full employment, improved cash flow and reduced out-of-stock situations. The company's production efficiency improved 20%-30%. Implementing the build-to-order methods reduced standard lead time from 2 weeks down to only one day. The company is now having their suppliers replenish product on a 'pull' system based on product sold during the previous week, which has resolved previous out of stock issues and resulted in sales increases of 55% and 79% in July and August 2010 over 2009 levels.